On Our Radar

On Our Radar

Government Monitors More than 900M Credit Card Accounts

The UK government is currently finishing loading all the medical records for that country's entire population onto one computer database, and plans to allow university and government researchers to access individual files later this year. It's argued that this could produce significant health benefits, allowing drugs, procedures and treatment strategies to be tracked on a massive scale for efficacy, cost and side effects. Only a patient's family doctor (and authorized clinicians who are actively treating him or her) can read the full file. Everyone else can see only versions in which the patient's name and full address have been redacted.

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Very few Britons seem remotely bothered by this, not least because, if they end up in an ER in a strange city, the clinicians who treat them could access their entire medical histories within a few keystrokes. But an additional proposal has caused a huge political row. The administration wants to sell those redacted patient records to the private sector. And this worries many, because it wouldn't be hard to use information remaining on supposedly anonymous files (the UK equivalent of the patient's Social Security number, along with his or her post code, which is a sort of super-ZIP code that identifies an address to within a small cluster of homes), and this means determined insurers and employers could end up reading deeply personal information.

Distrust of government

It's interesting that so many Britons have little problem with their government having access to their medical files, but hate the idea of private companies sharing the same information. Generally speaking, Americans often have a strong distrust of government that those in the UK don't seem to share. Of course, some academics blame the Brits for that.

"When you think about the beginning of the country, it was all about throwing off the shackles of the English monarchy," Professor Marc Hetherington, author of "Why Trust Matters: Declining Political Trust and the Demise of American Liberalism," remarked to NPR in 2010.

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Naturally, the level of distrust varies a lot. Pew Research Center has tracked Americans' trust in their governments since 1958, when, under President Dwight D. Eisenhower, it stood at 73%. It inched up from there in the last couple of years of his term and under Presidents John F. Kennedy and Lyndon B. Johnson, but then declined among many peaks and troughs over the following three decades, reaching a low of only 17% early in President Bill Clinton's first term. However, Clinton rebuilt trust in his remaining years, leaving office with it at roughly 42$. Except for a brief post-9/11 blip, it's been going downhill pretty much ever since, and in 2013 stood at 19%.

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Your credit cards and the government

That last figure may explain the political storm in this country over federal regulator the Consumer Financial Protection Bureau's (CFPB's) collection of data on over 900 million credit card accounts. Each file could contain, according to U.S. News and World Report:

Type of card

Card balance

Customer's other relationships with the card issuer and its parent bank

Customer's income, FICO score and payment history

Some worry that the anonymity provided for each file (none contains names or full addresses) could be compromised by someone determined to identify an individual, just as might happen to those UK medical records.

Lawmakers' and regulator's response

CFPB director Richard Cordray faced hostile questioning on the Bureau's data collection policies when he appeared before the Senate Banking Committee in November, and again at a hearing of the House Committee on Financial Services on Jan. 28. Lawmakers challenged the regulator's need to gather so much information, and questioned whether "de-identified" files (those made anonymous) could be re-identified.

On the first point, Cordray claimed that the current volume of data was necessary to effectively regulate credit card companies, although at least one economist believes a much smaller sample would suffice, according to U.S. News & World report. On the second, that of re-identifying de-identified files, he acknowledged that this was a complicated issue.

Cordray also said that the Bureau is only interested in monitoring market trends and how credit card holders are treated by issuers, and lacked both the desire and the capability to track individual consumers. In addition, he pointed to other regulators, such as the Office of the Comptroller of the Currency, which have in the past and continue now to use similar data.

At the first hearing, Senator Mike Crapo (R-ID) told Cordray that he had asked the U.S. Government Accountability Office to review the issue, and the CFPB director welcomed the move.

Your response

How you feel about this issue is likely to reflect the extent to which you trust your government. Given today's near-record levels of distrust, you may be outraged at the Big Brother potentialities of such massive data collection.

But, of course, all that information already exists in the private sector: that's where the CFPB's getting it. The Bureau knows nothing that your credit card companies don't. And those card issuers are sharing it with credit bureaus, which, in turn, are sharing it with pretty much anyone who's willing to pay a small fee: lenders, landlords, government agencies and employers, to name just a few. Credit checks provide way more personal and identifiable information than the CFPB has.

And yet many Americans still find it plain creepy that the government wants to know so much about them. How do you feel?